1.LAW OF DIMINISHING MARGINAL UTILITY:
As our marginal utility decreases with increase in consumption of same type of clothes. So they leverage on this and produce new designs.
2. Economies of Scope:
The average cost per unit can be reduced by producing more type of products from same type of machines and inputs. This is mostly used by textile industry.
3. Economies of Agglomeration:
Textile factories are often located near to each other because of the reasons like low transport costs and large supply of labor.
4. Increasing Return to Scale:
If we have skilled labour and technology then if we increase these inputs then the output will be more in proportion. So they use skilled labour and technology.
5. People respond to incentives:
Generally people buy things more when there are more offers so they will give more offers to customers.
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